InterTrade Ireland – Private Equity Conference 2007 – Sir Allan McClay – Founder of Gaylen and Allmac

From Cookstown. Nobody ever goes to Cookstown, they are sent to Cookstown.

4 P’s, people, presentation, product, professionalism, (5 p, that I’ll take, profit!).

His mother’s comment after school: He won’t lead or drive!

Started as a pharmacist. Payment of 5 shillings a month.

Worked for Glaxo for 13 years as a salesman.

No early specialisation, he got a broad thrust of what the pharmaceutical industry was about.

Then founded Gaylen. (Gaylen, the first physician).

Started Allmac in the last few years.

One man band for a year.

Packed and sold my own pharmaceutical products.

Did my own cashflow (cash business).

In those days there were good profit margins in pharmacy (not anymore!).

I’d like to write a book on “How not to start a business”. South East England would have been the perfect spot for a pharam business.

Never had any trouble myself (with the troubles).

Started trading in the Republic in the 80’s.

Not much government support.

Started with LEDU. Applied and was turned down. Dupont got 24m for 100 employees. Approached minister for commerce and said “If I came over here with my bottom painted black and an English accent you’d be throwing money at me”.

Manufacturing is drifting away. Knowledge based industry and R&D is the future. Manufacturing is all about “how cheap can we make it”.

We do the R&D here and outsource the manufacturing.

We want a quick answer to our requests for funding and state help. Can’t afford to wait around for three months.

Highly competitive market, every state in the US funding biotech.

Gaylen – the 4 P’s got right. Gaylen never had R&D like Allmac.

Gaylen was a pharma company, Allmac is a service company.

Persistence – Far too many people give up when they are next door to success.

Gaylen lost 60% of its turn over in ’84 when the blacklist came out.

You never know when you are close to success, their is always a dawn.

Why did you float Gaylen? Need expansion money, needed to make a US acquisition (eventually purchased Warner Chillcott). Dovetailed Warner-Chillcott marketing strengths with Gaylen manufacturing expertise.

Its not about money (its a driver), its about making a contribution in the field of science and humanity. Its a creative job.

Every company has its own thumbprint. People are not driven by money. Give people a job that interests them and that will motivate them. People work because they want to work.

Developed first class scientists in Craigavon, but the American market made that business cold. Allmac now have a team whose relationship amongst themselves is priceless.

Retired from Gaylen at 69.

29 nationalities in the factory in the Allmac factory in Portadown, mainly scientists.

Allmac has its own engineering department.

We think every other nation is better than us. (the Irish problem).

We are naturally good communicators.

Americans will rarely take you out after business is complete. (and go and talk to some Germans, their’s an experience for you!)

What do you think of VCs? They are like salt and sugar in your diet. You need some, but too much will kill you.

The eye is trained on the VC once they are on board. Science doesn’t work that way. VC would kill some of the Allmac projects.